How to Respond to the Latest Market Drop

Gary Cohn has resigned as President Donald Trump’s chief economic advisor over proposed steel and aluminum tariffs, leading to the Dow dropping 300 points Wednesday.

Why are the markets spooked? Because Cohn’s exit “signals that the Trump administration is absolutely going to move forward with tariffs and the risk of a trade war is now more elevated,” Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, told CNN Money.

So, is there anything you should do right now? No one can time the market, and no one knows what will happen. But the market is more than Gary Cohn. So here’s when I say what I say every time there’s a market movement:

Think Long-Term

“Regularly make investments, maybe monthly or weekly,” says Lou Haverty, a certified financial analyst. “By making small but regular contributions, you’ll have the benefit of investing during all market conditions. So in hindsight, you’ll get the benefit of investing after market corrections.”

Understand that this is normal, even if it hasn’t been for nearly the past decade. “People kind of forget what it’s like to have a downturn,” Scott Hanson, co-founder and senior partner at Hanson McClain Advisors, told CNBC. “It’s prudent to be prepared for one.”

Buy

“Right now, the market is disappointed, but one player’s not going to change the outlook for the economy,” Doug Cote, chief market strategist at Voya Investment Management, told Marketwatch. “I would say the market is overreacting and I would buy the dip.”

“Set up a monthly recurring investment in a ETF or diversified portfolio, so that you ensure you buy on the decline and profit on the other side,” suggests Evan Tarver, a financial analyst at Fit Small Business.